NRIs have for long been investing in India now, into property in particular. Looked at pragmatically, this is not merely thanks to purely emotional reasons, but for profit. Now that the Indian scenario is brightening up, with an improving economy and a whole bouquet of reforms being brought about to ensure free, fair, transparent and easy business transactions in real estate, the NRI today has all the more reason to invest into Indian properties, with the added advantage of world-class investor protection …
As the Indian economy gathers steam and heads for consistent recovery and stability, coupled with a series of reforms undertaken by reform-oriented, progressive Modi-led NDA government for improving investor sentiment by way of creating better investor climate, NRIs are confidently looking at investing in India, particularly in the real estate sector.
Because of the prevailing promising business environment, the relationship between India and its overseas community is on the upswing. This assumes significance as in today’s globalised world where people are mobile, the economic transformation of a country depends on shared resources and talent. Fully realising this , the Indian government is aiding mobility of Indian diaspora by declaring life time visas for those having PIO cards. Considering that Indian diaspora is spread all across the world, it is significant to leverage their potential. And to ensure that they invest their wealth and talent in India, the government is undertaking reforms aimed at improving investment climate, making it easier, transparent and profitable to do business in India.
Today, the focus of the government is on creating policy environment that is predictable, transparent and fair and is aimed at boosting the confidence of NRI/foreign investors especially when India has triple advantage of democracy, demography and demand. Moreover, with BRIC nations not doing well, foreign investors are looking at India, especially when it is more open to business. Indian government which is committed to push India to 50th position for ease of doing business, has already cleared changes in Companies Act to better ease of doing business. A series of policy measures for catalysing business/investments like expeditious and timely approval processes, progressive tax regime, rationalising labour laws and more clarity on FDI are also under way.
Considering the potential of NRI investments in property, the government is taking measures to make it easier for foreigners to invest more in real estate by doing away with unnecessary restrictions on flow of NRI & foreign capital. NRIs & PIOs can invest in residential and commercial property, repatriating profits from property sale and enjoying the tax waiver on reinvesting capital gains in property. NRIs are investing in property in India not just for pure emotional reasons but for profits. There is a significant shift among hardcore NRI investors, mostly HNIs, professionals and industrialists. Earlier they were restricting themselves to UK, USA due to safety of their investment but now they are looking at India as it is, in a big way, embarking on infrastructure development with major initiatives like building 100 smart cities. Bangalore, Mumbai, Pune, Goa, Gurgaon, Ahmedabad, Kochi have emerged as hot investment real estate destinations for NRIs with good quality investible properties including leasable properties.
The strengthening of Indian economy has a lot to do with NRIs growing interest in Indian property. And the government which is putting renewed emphasis on urbanisation with massive allocation for infrastructure development, has generated lot of interest in property investment, particularly as both residential and commercial office properties with good returns are quite affordable and NRIs are getting good deals. According to a recent Assocham survey, Indian property developers are anticipating substantial increase in inquiries from NRI buyers in the coming months.
Looking at this opportunity, developers and brokers are reaching out directly to NRIs by setting up overseas and holding property exhibitions and fairs, offering decent discounts to NRIs to improve their liquidity. NRIs are making investments, hoping to generate good profits as subdued property market in India is in the revival mode. A win-win situation for both property developers and NRI investors.